East Gulf Potential Attractive

Past Successes Suggest Big Pay Days

July 2001

Few wells have been drilled in the proposed
OCS Lease Sale 181 area in the eastern Gulf of Mexico. Still, the
largely unexplored area is projected to harbor some significant
hydrocarbon reserves, with a possible development potential of several
Tcf of natural gas and a billion or so barrels of oil.

There are two distinct hydrocarbon provinces in the sale area that are
geographically separated by the Florida Escarpment. Gently sloping
Mesozoic and Cenozoic sediments occur north of the escarpment, while
Tertiary clastic submarine fan deposits and Mesozoic sediments untested
offshore are found to the south.

Three significant geologic plays occur north of the
escarpment. These plays are producing gas in fields offshore Alabama,
according to MMS deputy regional supervisor for resource evaluation
David Marin.

Extended reading

Few wells have been drilled in the proposed
OCS Lease Sale 181 area in the eastern Gulf of Mexico. Still, the
largely unexplored area is projected to harbor some significant
hydrocarbon reserves, with a possible development potential of several
Tcf of natural gas and a billion or so barrels of oil.

There are two distinct hydrocarbon provinces in the sale area that are
geographically separated by the Florida Escarpment. Gently sloping
Mesozoic and Cenozoic sediments occur north of the escarpment, while
Tertiary clastic submarine fan deposits and Mesozoic sediments untested
offshore are found to the south.

Three significant geologic plays occur north of the
escarpment. These plays are producing gas in fields offshore Alabama,
according to MMS deputy regional supervisor for resource evaluation
David Marin.

More than 30 fields have been discovered in the shallow
Miocene sedimentary deposits between 2,000 and 4,000 feet subsea.
These are all gas fields and include two field discoveries in the
proposed Sale 181 area.

Four field discoveries have occurred on the shelf
offshore Alabama at intermediate depths of 12,000 to 15,000 feet
subsea within the Lower Cretaceous James Limestone. Initial production
from the James carbonates occurred here in 1998 in Chevron's Viosca
Knoll Block 69 field. This play runs across the sale area north
of the escarpment.

The Norphlet formation of Jurassic age is found at
depths greater than 20,000 feet in the OCS offshore Alabama. Any
hydrocarbons at these depths will be gas.

On the OCS, there are 13 discovered fields in the
Norphlet, Marin said, including one in the MMS Eastern Gulf Planning
Area. This is the Destin Dome Block 56 field, which is estimated
to contain as much as 3 Tcf of dry, natural gas, according to the
Department of Energy's (January 1997) Florida Energy Profile, and
MMS Lease Sale 181 Draft EIS.

Development of this late '80s discovery awaits a
decision from the U.S. Commerce Department. Where the Norphlet occurs
at depths less than 19,000 to the east, notable oil shows have been
found.

Some significant fields have been discovered in the
Mississippi Canyon and Viosca Knoll areas near the Eastern Gulf
Planning Area. These include the Ram Powell VK 956 field, Petronius
VK 786 field, King MC 84 field and the King's Peak DeSoto Canyon
133 in the Eastern Gulf of Mexico. The plays found within these
deep-water fields represent the important plays expected to be found
south of the Florida Escarpment in the sale 181 area.

Buried salt features define a second hydrocarbon
play in the area below the escarpment, Marin said. The Salt Roller
Play, with hydrocarbon traps formed by movement of the salt, has
not been tested.